14 June 2012
Peter Hogarth - Regional Director, UK Trade and Investment East Midlands
2012 – year of the London Olympics, the Queen’s Diamond Jubilee….and the double dip recession. A year of contrasts – from the carnival atmosphere of ‘once in a lifetime’ spectacles, to the uncomfortable reality of continuing economic woes.
Away from the national picture, what are things like on a more local level? Our focus in the East Midlands UKTI team is to understand how well the region’s exporters are doing. What happened in 2011 and what can we look forward to in 2012, aside from a summer of sport (not my particular specialist subject) and street parties (much more fun)?
On the up side, the East Midlands put in a storming export performance in 2011. Figures released in March 2012 showed that the East Midlands hit the highest level of exports in a calendar year since 2006, before the worldwide economic crisis hit. This was the region’s second highest level of exports ever. We sent 17.7 billion pounds worth of manufactured goods around the globe - up 2.5 billion over 2010.
So, where in the world did all these products and services end up? Surprisingly, or unsurprisingly, depending on which way you look at it, the EU remains the most important market for the East Midlands with Germany, Belgium and France all among the leading export destinations. But it was exports to Asia, North America and Africa that showed the highest rates of growth.
This then seems a pretty rosy picture for the economy of the region – the year’s report card is looking good. But, as is the nature of these things, there is ‘room for improvement’. Here at UKTI we see some clear, main challenges for the years to come. The first, quite simply, is to get more SMEs to export. Lord Green, Minster for Trade & Investment has already thrown down the gauntlet for this. His ambition is to raise the number of SMEs exporting by 100,000 in the next 5 years, which will be no mean feat. And alongside this is the ambition included in the recent budget for the UK to double exports by 2020 to £1 trillion.
The next challenge relates to the target markets of our exporters. Despite the continuing gloom in the Eurozone these countries still constitute our main markets for export. More companies export to the Republic of Ireland than to the entire BRIC markets combined – despite their ongoing economic growth. We need to demonstrate better to the region’s exporters the opportunities that exist for them in these large and surprisingly prosperous high-growth markets and help them to overcome the barriers, both real and perceived, that stop them from heading further afield.
So, UKTI activity in the East Midlands will seek to address these issues. Firstly, we will be working hard as export advocates, teaming up with intermediaries including the chamber, LEP, CBI, IoD, the banks, accountants and lawyers who will help us to spread the gospel of export, with the intention of reaching businesses with whom we have not yet engaged. Secondly, new and existing clients will continue to receive expert and impartial advice both from the East Midlands team and from our colleagues around the globe. This support will have an emphasis on ensuring that our clients have access to and advice on opportunities both near and far-flung, that they explore the markets that are right for them and that will give them a greater return on investment, wherever they may be.
Particular event highlights for the coming year include our series of sector based seminars which are being held at the British Business Embassy in London throughout the duration of the Olympics and will be broadcast live to audiences at Loughborough University. These events will provide delegates with a chance to hear from sector experts such as Stella McCartney, Marc Bolland and Sir Jonathan Ive, whilst communication between Loughborough and London will allow delegates to take part in the event interactively.
On the ubiquitous Olympic theme, we will be hosting an event in October looking at opportunities in China (the last holder of the games) and Brazil (the next holder of the games), as well as Qatar (World Cup 2018). We will also celebrate our local business champions in a Making it in Leicestershire, Selling to the World event.
To complement these bigger activities, amongst other things we will continue to host colleagues from around the globe who will be available to give 1:1 advice to companies in the region and we have an ongoing language and culture seminar programme.
We are determined to do our bit for the legacy of the Games. For us that means opening many more companies’ eyes to the possibilities of export and making plans to trade overseas a reality for them.
So, what about predictions for the year to come? A pretty safe bet could be a certain Jamaican winning the men’s 100 metres. But, to put my neck a bit more on the line, what does the future hold for our sales around the world? Feedback from companies is positive with some giving up low profit business at home in favour of orders from overseas. Europe is likely to remain no better than flat, but we are still competitive despite the recent increase in the value of sterling against the euro. The USA is growing and many other countries have an increasing demand for imported goods. So will we increase our exports by 16% again? Probably not but it could easily exceed 10% and exceed our highest ever levels of export. And this will continue.
One of our local MPS said at an export event recently that it is not a case of ‘export or die’ but ‘export and prosper’. Exports offer a clear route to growth.